We provide an information-based theory of matching efficiency fluctuations. Rationally inattentive firms have limited … capacity to process information and cannot perfectly identify suitable applicants. During recessions, higher losses from hiring … unsuitable workers cause firms to be more selective in hiring. When firms cannot obtain sufficient information about applicants …

systematic ways. For example, students who receive extremely positive information about their ability revise upward their … prediction for short-term grade-point average (GPA). Similarly, those who receive very negative information revise downward their … analysis: Prior beliefs about outcomes to be realized in college tend to be fairly precise, while new information influences …

Standard sticky information pricing models successfully capture the sluggish movement of aggregate prices in response … to monetary policy shocks but fail at matching the magnitude and frequency of price changes at the micro level. This … paper shows that in a setting where firms choose when to acquire costly information about different types of shocks …

be traced to the incompleteness of markets (due to private information) and the increased price volatility that results …

substantial socioeconomic gradient. We focus on information gaps - specifically, incomplete information about college benefits and … costs - as a potential explanation for these patterns. For this purpose, we conduct an information experiment about college …'s child, the two main behavioral outcomes of interest. Respondents are then randomly exposed to one of two information …